Pakistan has taken a major step toward the privatization of Zarai Taraqiati Bank Limited (ZTBL)—the country’s largest state-owned agricultural bank—by signing a financial advisory services agreement, the Privatization Commission announced on Friday.
This move aligns with Islamabad’s ongoing efforts to reform its public sector under commitments made to the International Monetary Fund (IMF). These commitments include the privatization of loss-making or underperforming state-owned enterprises (SOEs) to improve operational efficiency and reduce fiscal burdens.
ZTBL’s privatization is seen as a key part of the government’s strategy to modernize agricultural finance, especially as Pakistan grapples with increasing climate-related challenges affecting food security. The aim is to support farmers in adopting advanced technologies and practices that can enhance crop yields and build resilience.
“The privatization of ZTBL is designed to catalyze investment in Pakistan’s agricultural future by combining private sector efficiency with the bank’s long-standing expertise in agricultural finance,” the Privatization Commission said in a statement. “The goal is to ensure farmers have timely access to essential financial resources.”
The financial advisory services agreement was signed with a consortium led by Next Capital Limited. Under the agreement, the consortium will carry out due diligence, engage with potential investors, structure and market the transaction, and assist in conducting a transparent bidding process.
ZTBL currently operates a nationwide network of over 500 branches, providing credit and financial services to small-scale farmers and rural communities. Officials anticipate that private sector involvement will expand the bank’s product offerings, introduce modern banking technologies, improve governance, and enhance customer service.